Among the various functional imaging techniques, SPECT maintains an important role in the study of disease models in small animals as well as in patient care. Many SPECT-labeled imaging probes that have highly specific distributions with very little background are being used to measure a wide range of biological parameters of importance in small animals including substrate metabolism, blood flow, hypoxia, protein synthesis and receptor characteristics. The utility of this important modality has been significantly enhanced in recent years by the development of methods to image transgene expression in vivo. Furthermore, SPECT is capable of dual-isotope imaging for correlating two biological processes with a single imaging study. Recent demand for small animal SPECT has also been driven by the pharmaceutical industry where in vivo quantification of biological processes to measure an agent's mechanism of action and its concentration at the site of action is necessary. Each of these applications requires excellent spatial resolution, not only because of the small scale of the details to be imaged but also for the demanding detection and estimation tasks. Unfortunately, existing SPECT instrumentation does not provide the required performance, so the development of a high-resolution detector is essential for the improvement of future SPECT systems. To address these issues, we propose to develop a novel detector based on a unique design of a scintillator coupled to a very high spatial resolution readout. Specifically, the scintillator design and fabrication will minimize the loss of resolution arising from parallax errors due to depth-of-interaction effects within the scintillator, while maintaining very high efficiency for the detection of incident radiation. This combination of scintillator and readout, when coupled to a custom designed collimator, will form a SPECT detector module that can achieve extremely fine spatial resolution and high sensitivity in a cost-effective manner. The effort subsequent to the successful development of the detector module will focus on the development of a complete small-animal SPECT system as a prototype product.